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TMI Blog1986 (2) TMI 92X X X X Extracts X X X X X X X X Extracts X X X X ..... said firm because in a firm of professionals, the dominant factors were personal skill, integrity, honesty and professional expertise. The Assistant Controller, however, held that the aforesaid firm of solicitors had been in existence for a number of years and the clientele was attracted by the firm's name and not because the said firm had a particular individual as a partner and it was doubtful if many clients knew the names of the partners of the said firm, not to mention the personal skill, integrity, etc., of the partners of the said firm. As the said firm was a leading firm of solicitors, the Assistant Controller worked out the goodwill at two years' purchase of the average of the five year's profits of the firm and the deceased's 19 p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to payment not exceeding Rs. 1,000 per month calculated at the rate of Rs. 50 for each year of her husband's service as a partner. According to clause 36, a retiring partner could not practise for ten years within the restricted area as a solicitor, etc. Under clause 39, in the event of the firm being wound up, the partners have to enter into a covenant with the purchasers not to practise as a solicitor for a period of ten years within the restricted area. 5. It was urged that on the reading of the aforesaid clauses, the case before us was distinguishable from Arundale's case on which the Bombay High Court had relied in Motichand and Devidas, In re. [1946] 14 ITR 534 because the Bombay High Court went by the legal position that upon the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tant and tax consultant had made a gift of goodwill to his son on taking the son as a partner. The High Court at p. 797 noted the revenue's contention that some goodwill must be deemed to attach to the business or profession of chartered accountants and tax consultants and after defining 'goodwill' observed at page 798 that there was little doubt that goodwill was applicable to a purely personal business like that of a solicitor and perhaps the same considerations may apply to the business of a chartered accountant or tax consultant and referred to Cordery on Solicitors, Sixth edn., p. 483 where it was observed that such goodwill is frequently dealt with as having an ascertainable value and it had been described as "the advantage, whatever ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, rules 2A and 2B of the Wealth-tax Rules, 1957, the WTO could value one asset and need not value the assets of the business as a whole. It was urged that the said decision could not be imported in estate duty proceeding because the said decision was given in view of rules 2A and 2B. 11. We have given careful consideration to the submissions of the assessee as also of the department who, in reply, claimed that goodwill did not appear as an asset in the balance sheet of the said firm Crawford Bayley Co. and, therefore, the case was covered by CED v. G.H. Malhotra [1983] 144 ITR 925 (Bom.). The legal position that emerges is that the entire assets of the firm as per balance sheet have to be valued and not one asset of the firm, namely, g ..... X X X X Extracts X X X X X X X X Extracts X X X X
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